0:00:06.230,0:00:08.535
>> I want you to[br]do something.

0:00:08.535,0:00:10.200
I'd like you to[br]take a moment and

0:00:10.200,0:00:11.670
visualize a successful

0:00:11.670,0:00:13.035
international business.

0:00:13.035,0:00:14.790
Picture of the[br]company that you

0:00:14.790,0:00:17.790
believe best epitomizes[br]global trade.

0:00:17.790,0:00:19.380
Did you picture a global

0:00:19.380,0:00:20.840
multi-national[br]conglomerate?

0:00:20.840,0:00:23.390
One of the world's[br]largest corporations,

0:00:23.390,0:00:25.615
Global 100 or the like.

0:00:25.615,0:00:27.890
How about one of the[br]companies actually has

0:00:27.890,0:00:29.180
the word[br]international baked

0:00:29.180,0:00:30.290
right into their name,

0:00:30.290,0:00:34.355
maybe IBM, AIG, or ING.

0:00:34.355,0:00:36.800
Is it one of the global[br]brands that you see

0:00:36.800,0:00:38.870
when you travel[br]overseas everywhere?

0:00:38.870,0:00:42.035
Subway, KFC or[br]7-Eleven for example.

0:00:42.035,0:00:43.250
Or maybe the Gap,

0:00:43.250,0:00:44.540
which is now a[br]familiar sight

0:00:44.540,0:00:46.025
all around the world.

0:00:46.025,0:00:48.275
How many of you pictured

0:00:48.275,0:00:50.300
a small business with

0:00:50.300,0:00:52.055
fewer than 50 employees?

0:00:52.055,0:00:54.875
One with only a[br]single location,

0:00:54.875,0:00:57.815
a family-owned and[br]operated business.

0:00:57.815,0:00:59.780
This isn't what[br]springs to mind for

0:00:59.780,0:01:00.860
most people when they think

0:01:00.860,0:01:02.330
about international trade.

0:01:02.330,0:01:05.000
But the fact is that[br]over 98 percent of

0:01:05.000,0:01:06.380
exporters are small

0:01:06.380,0:01:08.075
and medium-size businesses.

0:01:08.075,0:01:09.830
In the United States alone,

0:01:09.830,0:01:13.070
that's over 269,000 local

0:01:13.070,0:01:14.390
businesses that

0:01:14.390,0:01:16.110
have successfully[br]gone global.

0:01:16.110,0:01:17.800
For the past 25 years,

0:01:17.800,0:01:18.470
I've been working with

0:01:18.470,0:01:19.460
companies as they enter

0:01:19.460,0:01:21.190
and expand into[br]foreign markets,

0:01:21.190,0:01:22.940
and they really[br]aren't who you

0:01:22.940,0:01:25.185
think they are.[br]What are they like?

0:01:25.185,0:01:27.210
Who are they and[br]what do they sell?

0:01:27.210,0:01:29.090
More importantly,[br]what can all of

0:01:29.090,0:01:31.265
the companies that[br]haven't yet gone global,

0:01:31.265,0:01:33.200
learn from their example?

0:01:33.200,0:01:36.410
Back in 1996, the[br]Millionaire Next Door

0:01:36.410,0:01:37.550
was a surprise[br]hit on the New

0:01:37.550,0:01:39.080
York Times bestseller list.

0:01:39.080,0:01:41.270
It totally challenged[br]our perception about

0:01:41.270,0:01:43.370
who the affluent[br]really are.

0:01:43.370,0:01:44.900
We learned that the[br]wealthy weren't really

0:01:44.900,0:01:46.820
much like Blake Carrington,

0:01:46.820,0:01:50.795
the oil tycoon from the[br]1980s TV hit Dynasty.

0:01:50.795,0:01:53.060
Or his 21st-century[br]equivalent,

0:01:53.060,0:01:55.375
Lucius Lyon from Empire.

0:01:55.375,0:01:58.280
Actual millionaires[br]turned out to be far

0:01:58.280,0:02:01.085
more like modern[br]families, J. Pritchard,

0:02:01.085,0:02:02.750
the people that we see in

0:02:02.750,0:02:04.265
our neighborhoods[br]every day,

0:02:04.265,0:02:05.510
predominantly running their

0:02:05.510,0:02:07.085
own small businesses,

0:02:07.085,0:02:09.290
living very modestly, and

0:02:09.290,0:02:12.275
disproportionately[br]driving pickup trucks.

0:02:12.275,0:02:15.080
It turns out that[br]this is also

0:02:15.080,0:02:17.629
very true of[br]international business,

0:02:17.629,0:02:19.100
and a whole new[br]generation of

0:02:19.100,0:02:20.810
millionaires next[br]door are being

0:02:20.810,0:02:22.670
created by small businesses

0:02:22.670,0:02:24.970
that're increasingly[br]going global.

0:02:24.970,0:02:29.150
The fact is, in the[br]United States currently,

0:02:29.150,0:02:30.800
over 90 percent of

0:02:30.800,0:02:32.630
successful exporters are

0:02:32.630,0:02:35.150
single location[br]small businesses,

0:02:35.150,0:02:37.070
37 percent of which have

0:02:37.070,0:02:39.140
fewer than 20 employees.

0:02:39.140,0:02:40.775
Think about that[br]for a moment.

0:02:40.775,0:02:42.020
Over a third of

0:02:42.020,0:02:43.730
successful[br]exporters are about

0:02:43.730,0:02:45.020
the same size as

0:02:45.020,0:02:46.715
your favorite local[br]clothing boutique.

0:02:46.715,0:02:48.350
In fact, some of[br]them actually

0:02:48.350,0:02:50.750
are your favorite local[br]clothing boutiques.

0:02:50.750,0:02:52.790
The cliche would be[br]to call them mom and

0:02:52.790,0:02:54.920
pop businesses, and[br]many of them are.

0:02:54.920,0:02:56.750
But many more would[br]actually be better

0:02:56.750,0:02:58.880
described as[br]mother-daughter businesses.

0:02:58.880,0:02:59.960
A growing percentage[br]of them are

0:02:59.960,0:03:01.720
female-owned and operated.

0:03:01.720,0:03:04.755
What do small[br]businesses export?

0:03:04.755,0:03:08.125
Well, really anything[br]and everything.

0:03:08.125,0:03:09.350
Here's some examples of

0:03:09.350,0:03:10.580
small business shipments

0:03:10.580,0:03:12.410
in just the last week.

0:03:12.410,0:03:15.395
Custom made tops for[br]off-road vehicles,

0:03:15.395,0:03:17.780
material for making[br]dental molds,

0:03:17.780,0:03:21.175
multi-level luxury[br]kitty houses,

0:03:21.175,0:03:23.820
slobber proof[br]webcam, so you

0:03:23.820,0:03:26.345
can skype with the[br]dog while you travel.

0:03:26.345,0:03:28.715
Tailored orthopedic[br]products,

0:03:28.715,0:03:31.505
woodworking equipment,[br]skateboards,

0:03:31.505,0:03:33.680
stand up paddleboards, and

0:03:33.680,0:03:35.615
my personal[br]favorite, steampunk

0:03:35.615,0:03:37.460
costume jewelry.

0:03:37.460,0:03:39.170
This one might require

0:03:39.170,0:03:40.460
a little bit of[br]explanation.

0:03:40.460,0:03:43.540
These aren't very[br]tiny steam engines.

0:03:43.540,0:03:45.695
Steampunk is a huge trend

0:03:45.695,0:03:46.730
among fans of science

0:03:46.730,0:03:47.930
fiction and fantasy that

0:03:47.930,0:03:49.625
re-envisions the genre with

0:03:49.625,0:03:52.865
1800s era, Industrial[br]Revolution inspiration.

0:03:52.865,0:03:55.865
Think George Lucas[br]meets Jules Verne,

0:03:55.865,0:03:57.530
Princess Leia[br]in a hoop skirt

0:03:57.530,0:03:58.760
with a parasol and

0:03:58.760,0:04:00.620
the millennium falcons[br]now at dirigible

0:04:00.620,0:04:03.005
with ornate gears[br]and tail fins.

0:04:03.005,0:04:04.895
This export is my favorite

0:04:04.895,0:04:06.320
because they're[br]very illustrative

0:04:06.320,0:04:07.970
of how many[br]businesses first get

0:04:07.970,0:04:09.830
involved in[br]international trade.

0:04:09.830,0:04:10.310
This is one of

0:04:10.310,0:04:11.570
those mother-daughter[br]companies

0:04:11.570,0:04:13.020
that we're talking[br]about a minute ago.

0:04:13.020,0:04:14.525
In a couple of years back,

0:04:14.525,0:04:16.750
they weren't planning[br]to export at all.

0:04:16.750,0:04:19.095
In fact, they[br]went to import.

0:04:19.095,0:04:20.810
Their plan was to import

0:04:20.810,0:04:22.160
really cool retro

0:04:22.160,0:04:24.080
Victorian and[br]gothic jewelry

0:04:24.080,0:04:25.850
to sell the steampunk[br]fans who dress

0:04:25.850,0:04:27.940
up in costumes and[br]go to conventions.

0:04:27.940,0:04:29.360
What they'd hoped to do was

0:04:29.360,0:04:30.560
to import these items from

0:04:30.560,0:04:32.180
the coolest Victorian and

0:04:32.180,0:04:34.235
Gothic places that[br]they could think of.

0:04:34.235,0:04:37.220
But they couldn't find[br]a supplier in London,

0:04:37.220,0:04:40.055
or Hong Kong, or Prague,

0:04:40.055,0:04:41.510
or anywhere else[br]they thought that

0:04:41.510,0:04:43.300
things like this[br]might be found.

0:04:43.300,0:04:44.340
They had their own

0:04:44.340,0:04:45.940
pieces custom manufactured,

0:04:45.940,0:04:46.820
and they put them up on

0:04:46.820,0:04:48.140
their website[br]hoping to sell to

0:04:48.140,0:04:49.250
the locals who[br]were working on

0:04:49.250,0:04:51.035
their costumes[br]for Dragon Con,

0:04:51.035,0:04:54.050
aka nerdy grow,[br]an annual event

0:04:54.050,0:04:57.815
drawing 52,000 genre fans.

0:04:57.815,0:05:01.415
But what they got, were[br]orders from London,

0:05:01.415,0:05:04.820
and Hong Kong,[br]and even Prague.

0:05:04.820,0:05:06.470
That's when they did what

0:05:06.470,0:05:07.790
many companies do when

0:05:07.790,0:05:08.870
first presented with

0:05:08.870,0:05:10.745
international growth[br]opportunities.

0:05:10.745,0:05:14.320
They fought those[br]orders off hard.

0:05:14.320,0:05:15.980
They walked away from

0:05:15.980,0:05:17.780
sales and left money[br]on the virtual table.

0:05:17.780,0:05:18.980
They told customers that

0:05:18.980,0:05:20.240
they were only[br]set up to sell

0:05:20.240,0:05:21.770
domestically and[br]they even put

0:05:21.770,0:05:23.795
terms to that effect[br]on their website.

0:05:23.795,0:05:24.800
But they also had

0:05:24.800,0:05:26.335
their phone number[br]on their website.

0:05:26.335,0:05:27.905
One persistent

0:05:27.905,0:05:29.825
potential international[br]customer,

0:05:29.825,0:05:31.700
absolutely[br]insistent that they

0:05:31.700,0:05:33.530
were going to[br]take her money,

0:05:33.530,0:05:36.230
called and patiently[br]walked them through,

0:05:36.230,0:05:37.430
what would be[br]required to ship

0:05:37.430,0:05:38.995
her order internationally.

0:05:38.995,0:05:40.760
It turned out to[br]be a lot less

0:05:40.760,0:05:43.745
difficult than explaining[br]what steampunk is.

0:05:43.745,0:05:46.235
When they got to the[br]part about payment,

0:05:46.235,0:05:48.080
the customer[br]courageously asked them,

0:05:48.080,0:05:51.295
you do have credit[br]cards in your country?

0:05:51.295,0:05:53.540
Now today this business has

0:05:53.540,0:05:54.650
very different terms on

0:05:54.650,0:05:56.060
their website, and[br]more importantly,

0:05:56.060,0:05:57.780
they've got over 280,000

0:05:57.780,0:05:59.570
in international[br]top-line sales,

0:05:59.570,0:06:00.800
which have grown[br]to account for

0:06:00.800,0:06:02.330
about a third of[br]their revenue.

0:06:02.330,0:06:05.660
There are thousands of[br]examples like this.

0:06:05.660,0:06:07.415
Small business[br]owners becoming

0:06:07.415,0:06:09.170
unlikely millionaires[br]by opening

0:06:09.170,0:06:11.330
their shops to[br]international trade.

0:06:11.330,0:06:12.905
But here's the crazy part.

0:06:12.905,0:06:14.165
In the United States,

0:06:14.165,0:06:15.770
fewer than one percent

0:06:15.770,0:06:17.585
of companies[br]currently export.

0:06:17.585,0:06:19.550
This is the lowest level of

0:06:19.550,0:06:22.340
active exporters in the[br]industrialized world.

0:06:22.340,0:06:24.629
The vast majority[br]of US business,

0:06:24.629,0:06:25.875
stops at the border.

0:06:25.875,0:06:27.965
We talk about leaving[br]money on the table,

0:06:27.965,0:06:31.370
Yikes, why is[br]this the case?

0:06:31.370,0:06:33.560
International borders[br]have never been

0:06:33.560,0:06:36.445
more permeable to trade[br]than they are today.

0:06:36.445,0:06:38.600
The fact is, the barriers

0:06:38.600,0:06:39.800
that most companies face

0:06:39.800,0:06:41.300
in going international just

0:06:41.300,0:06:43.130
aren't the borders[br]on the map.

0:06:43.130,0:06:44.810
The borders they[br]have a hard time

0:06:44.810,0:06:46.280
crossing are the ones[br]that they establish

0:06:46.280,0:06:51.875
for themselves, doubt,[br]uncertainty, fear.

0:06:51.875,0:06:53.990
Doubt that there's[br]international

0:06:53.990,0:06:55.885
opportunity[br]available for them.

0:06:55.885,0:06:58.010
Uncertainty about[br]how to reach

0:06:58.010,0:07:00.110
customers in[br]foreign markets.

0:07:00.110,0:07:01.955
Fear, fear that

0:07:01.955,0:07:04.620
international business[br]is inherently risky.

0:07:04.620,0:07:07.185
Now, this first[br]self-imposed border,

0:07:07.185,0:07:08.980
doubt that there's[br]international opportunity

0:07:08.980,0:07:10.270
available for[br]most businesses,

0:07:10.270,0:07:13.315
it simply couldn't be[br]further from the truth.

0:07:13.315,0:07:14.920
The International[br]Trade Administration

0:07:14.920,0:07:16.840
reports that over[br]70 percent of

0:07:16.840,0:07:18.490
the world's purchasing[br]power is now

0:07:18.490,0:07:20.875
located outside[br]the United States,

0:07:20.875,0:07:23.105
along with 95 percent

0:07:23.105,0:07:24.520
of the world's consumers.

0:07:24.520,0:07:26.260
International[br]opportunity isn't just

0:07:26.260,0:07:27.325
knocking at your door.

0:07:27.325,0:07:28.900
It's already eaten[br]your porridge,

0:07:28.900,0:07:29.710
sat in all three of

0:07:29.710,0:07:30.670
your chairs and[br]it's heading

0:07:30.670,0:07:31.750
upstairs to figure[br]out which one

0:07:31.750,0:07:33.830
of your beds it wants.

0:07:33.870,0:07:36.130
The second self-imposed

0:07:36.130,0:07:37.750
border is uncertainty.

0:07:37.750,0:07:38.980
Uncertainty about[br]how to reach

0:07:38.980,0:07:40.570
customers in[br]foreign markets.

0:07:40.570,0:07:42.280
This is what causes[br]most companies

0:07:42.280,0:07:43.810
to pull the virtual[br]welcome mat

0:07:43.810,0:07:45.070
off their websites and

0:07:45.070,0:07:47.460
confine themselves[br]to domestic sales.

0:07:47.460,0:07:50.540
What if we do something[br]wrong? They ask.

0:07:50.540,0:07:53.780
What if we sell things[br]we aren't supposed to,

0:07:53.780,0:07:56.935
to people or places we[br]aren't supposed to?

0:07:56.935,0:08:00.229
That's not actually[br]international business,

0:08:00.229,0:08:01.580
that's called smuggling.

0:08:01.580,0:08:03.590
That's something[br]completely different.

0:08:03.590,0:08:05.330
If you're border[br]shifts that

0:08:05.330,0:08:07.555
quickly from we don't[br]know how to export,

0:08:07.555,0:08:08.960
to what if we accidentally

0:08:08.960,0:08:10.955
become international[br]crime lords,

0:08:10.955,0:08:12.350
it probably wasn't a very

0:08:12.350,0:08:14.015
firm board to begin with.

0:08:14.015,0:08:16.235
Either way, there literally

0:08:16.235,0:08:18.080
is an app for[br]that and it'll

0:08:18.080,0:08:19.760
keep you out of trouble[br]and it's available to

0:08:19.760,0:08:21.080
your business[br]for the low cost

0:08:21.080,0:08:22.805
of absolutely free.

0:08:22.805,0:08:26.160
The final self-imposed[br]border is fear.

0:08:26.160,0:08:28.880
Many companies truly[br]believe that engaging in

0:08:28.880,0:08:30.455
international growth[br]opportunities

0:08:30.455,0:08:31.340
opens you up to

0:08:31.340,0:08:34.265
everything bad that[br]can possibly happen.

0:08:34.265,0:08:39.230
Loss, damage, theft,[br]delay, diversion,

0:08:39.230,0:08:42.930
regulatory penalty,[br]the high seas piracy,

0:08:42.930,0:08:44.210
some of them have seen

0:08:44.210,0:08:45.290
the movie Captain Phillips,

0:08:45.290,0:08:47.495
maybe one too many times.

0:08:47.495,0:08:49.460
Numerous studies[br]have shown that it's

0:08:49.460,0:08:51.440
actually far more risky to

0:08:51.440,0:08:52.160
remain confined to

0:08:52.160,0:08:53.300
the domestic market than it

0:08:53.300,0:08:54.170
is to engage in

0:08:54.170,0:08:55.860
international growth[br]opportunities.

0:08:55.860,0:08:58.460
Companies that export[br]have exponentially

0:08:58.460,0:08:59.780
more growth[br]opportunity available

0:08:59.780,0:09:01.120
to them and those[br]that don't,

0:09:01.120,0:09:02.760
and they are[br]nearly eight and

0:09:02.760,0:09:04.280
a half percent less

0:09:04.280,0:09:06.110
likely to go out of[br]business than those are

0:09:06.110,0:09:08.030
confined to the[br]domestic market.

0:09:08.030,0:09:09.380
Knowing those numbers,

0:09:09.380,0:09:11.240
why wouldn't you export?

0:09:11.240,0:09:13.250
That one percent of[br]American companies

0:09:13.250,0:09:14.825
that do currently export,

0:09:14.825,0:09:18.700
they have phenomenal[br]growth opportunities.

0:09:18.700,0:09:20.704
Those are the businesses[br]that are creating

0:09:20.704,0:09:22.085
the next generation

0:09:22.085,0:09:23.615
of millionaires next door,

0:09:23.615,0:09:25.535
and even some billionaires.

0:09:25.535,0:09:26.570
A moment ago we talked

0:09:26.570,0:09:27.530
about the Gap when we were

0:09:27.530,0:09:28.610
talking about visualizing

0:09:28.610,0:09:29.690
successful business.

0:09:29.690,0:09:31.325
Do you know how[br]they got started?

0:09:31.325,0:09:33.200
A husband and a wife having

0:09:33.200,0:09:36.185
a very hard time finding[br]pants that fit him,

0:09:36.185,0:09:38.285
opened a single small store

0:09:38.285,0:09:40.700
to sell blue jeans[br]and vinyl records.

0:09:40.700,0:09:42.050
Today they shipped to over

0:09:42.050,0:09:44.180
90 countries around[br]the world and they

0:09:44.180,0:09:45.860
open up more stores[br]internationally

0:09:45.860,0:09:48.035
every year than they[br]do domestic ones.

0:09:48.035,0:09:50.570
For today's[br]neighborhood business,

0:09:50.570,0:09:53.435
the neighborhood is now[br]a whole lot bigger.

0:09:53.435,0:09:55.295
The world is your neighbor,

0:09:55.295,0:09:57.710
and it's waving,[br]and it's smiling,

0:09:57.710,0:09:59.630
and it's trying to[br]get your attention

0:09:59.630,0:10:02.170
because it wants to[br]do business with you,

0:10:02.170,0:10:07.420
and it's time to wave[br]back. Thank you.